Record Growth in U.S. Energy Storage Market

(Reuters) – The U.S. energy storage market saw record growth in the third quarter with 3,806 megawatts (MW) of installations and 9,931 megawatt-hours (MWh) deployed, according to a report by Wood Mackenzie released on Thursday.

This marks an 80% increase in installations and a 58% increase in energy deployed compared to the previous year, as reported in partnership with the American Clean Power Association.

Why It's Important

U.S. grid connection queues continue to rise as network operators manage a vast number of clean power applications amidst declining transmission capacity. The Energy Department's National Transmission Planning Study indicates that the U.S. needs to double or triple its transmission capacity within the next three decades to fulfill demand growth and reliability needs.

Grid-scale installations are expected to more than double by 2028, reaching a total of 63.7 gigawatts (GW), while residential installations could reach 10 GW of storage in the same timeframe, according to the report.

Context

Grid-scale energy storage deployments were primarily led by Texas and California—Texas added nearly 1.7 GW while California contributed around 6 GWh. The report also highlights that the residential market achieved an all-time high last quarter with an addition of 346 MW of storage, marking a 63% increase compared to the previous quarter.

Key Quotes

> "Overall, storage installations will grow 30% in 2024, signaling the industry's strongest year yet. However, sustaining this pace will be challenging. Between 2025 and 2028, we project an average annual growth rate of 10%, as early-stage development constraints persist," said Nina Rangel, senior research analyst at Wood Mackenzie.

> "…Any major shifts in tax incentives or increased tariffs could overshadow benefits and impact new project development," stated Allison Weis, global head of storage for Wood Mackenzie.